Nine directors of Ssangyong Motor Co., controlled by China's Shanghai Automotive Industry Corp., face a lawsuit for allegedly stealing technology from the company for its Chinese parent, according to a civic group Friday.
Spec Watch Korea, the civic group that monitors foreign investors, and members of Ssangyong Motor's labor union filed the suit at 11 a.m. at the prosecutors' office in Seoul, accusing the Chinese-owned automaker of leaking auto assembly technology to its parent, Shanghai Automotive.
In late June, Shanghai Automotive announced it will make Ssangyong Motor's sport utility vehicles in China through a licensing agreement worth 24 billion won (US$25 million), sparking a massive protest among Ssangyong Motor workers here. The agreement was endorsed by the automaker's board.
"The proposed license fee is only a tenth of the development cost for a new car, causing a significant amount of losses for Ssangyong Motor," said Chung Jong-nam, a senior official at Spec Watch Korea, which led the suit.
"Also, the nine directors have been accused of not implementing their 2 trillion won investment plan for Ssangyong Motor employees," Chung said.
The lawsuit was filed against Ssangyong Motor President and Chief Executive Director Choi Hyung-tak and eight other directors, including Jiang Zhiwei, who is a vice chairman of Shanghai Automotive, Chung said.
Public relations officials at Ssangyong Motor in Seoul didn't answer repeated phone calls seeking a comment.
The lawsuit is the latest reflection of anxiety by Ssangyong Motor workers, who have criticized the Chinese owner of the company for transferring technology without any visible investment here after the acquisition.
In late 2004, Shanghai Automotive bought a controlling 48.9 percent stake in Ssangyong Motor, which specializes in sport utility vehicles such as the Kyron and Actyon, becoming the first Chinese company to own a major company in South Korea.
On Friday, unionized workers at Ssangyong Motor launched a full-time strike and blocked a shareholder meeting at the company's headquarters in Pyeongtaek, south of Seoul.
During the shareholder meeting, Shanghai Automotive planned to appoint Philip Murtaugh, the Chinese automaker's executive vice president, as Ssangyong Motor's new representative director.
"We had planned to stage a legitimate fight, but a physical clash with the management forced us to begin a full-time strike," a union official who asked not to be named said.
On July 10, Ssangyong Motor offered to discuss with the union a layoff of 986 workers, or about 13 percent of the company's total employees, the union said on its Web site. If Murtaugh's appointment is completed, he will speed up the job-cut plan, it said.
So far this year, Ssangyong Motor has been hit by partial strikes owing to disputes between the company's South Korean employees and the Chinese parent.
Last month, Ssangyong Motor reported a 51.8 percent year-on-year plunge in July sales.
Ssangyong Motor sold 6,477 vehicles at home and abroad in July.
Exports plummeted 61.5 percent and domestic sales fell 27 percent.
Seoul, Aug. 11 (Yonhap News)
Ssangyong Motor's directors face suit over alleged technology leaks |
